Insurance Policies for Active Shooter Incidents May Limit Your Ability to Respond Effectively
The agreed-upon definition of an “active shooter” by US government agencies (including the White House, US Department of Justice, FBI, US Department of Education, US Department of Homeland Security, and Federal Emergency Management Agency) is “an individual actively engaged in the killing or attempting to kill people in a confined and populated area”. Unfortunately, the frequency of these incidents seems to be on the rise over the past few decades. The February 15th occurrence in Aurora, IL where a gunman killed and wounded several individuals at an industrial complex is a reminder that this can occur locally. Some proactive risk managers are now purchasing insurance for such events. These Active Shooter policies can provide coverage for such events, but also include services that help organizations evaluate risk, plan for prevention, and coordinate a response.
The Insurance Coverage
There may be some insurance benefits from a ‘standard’ insurance policy that would respond to an Active Shooter event in the workplace. However, many ‘standard’ insurance policies have a provision that may limit their ability to respond as effectively as a policy written specifically for an Active Shooter event. In many cases, a ‘standard’ insurance policy requires victims to allege negligence of the insured for coverage to apply. Establishing negligence may be difficult to do, but even if it’s possible, it will likely take some time. An Active Shooter policy responds on day one of the incidents and can provide benefits to victims and their families. Benefits may include medical expenses, lost wages, and death benefits.
Some risk managers have noticed that they have coverage for incidents of Terrorism and wonder if Active Shooter events would qualify for coverage under the Terrorism coverage they currently purchase. The answer is maybe. Terrorism coverage as it exists in most ‘standard’ policies must meet specific requirements for coverage to apply. One of the most important elements is that the event must be deemed “a Certified Terrorist Attack” by the U.S. Secretary of the Treasury, the Attorney General, and the U.S. Secretary of Homeland Security. Active Shooter policies can be purchased that waive all Terrorism exclusions making coverage quick and easy to define.
Crisis Management is also an area where there can be a difference between ‘standard’ insurance coverage and an Active Shooter policy. ‘Standard’ insurance policies may offer some coverage for Crisis Management that generally ranges from 1) low limits for limited services to 2) no coverage at all. Active Shooter policies can contemplate utilization of a public relations consultant, counseling for affected individuals, dedicated crisis hotline, temporary security measures, and an independent investigation for sole use by the insured. Limits on the Active Shooter policies can be as high as $25,000,000.
Insurance coverage is a focus but preparing your organization for a potential event could be deemed as more important than the actual coverage provided by the insurance policy. Identifying weaknesses and planning for a possible event are services that are provided by many insurers. The pre-planning security review provided by Active Shooter insurers can identify security gaps, outline response strategies, provide employee training and overall raise awareness of the situations that may lead to Active Shooter events.
Contact an Insurance Advisor
Coverage and services will vary from policy to policy. This is true for ‘standard’ policies and Active Shooter policies; there isn’t a one-size-fits-all option that exists. To learn more about what suitable options exist for your organization, reach out to a qualified insurance advisor who can help you explore what may be the best fit for you.